DESCRIPTION: Depression is the most common psychiatric morbidity in youths with insulin dependent diabetes mellitus (IDDM), is often protracted, and is a risk factor for medical complications. However, there are no psychosocial interventions of proven effectiveness for this mental disorder in juveniles with IDDM. Thus, the goals of this project are to: (a) modify an existing manual for treatment of depression in childhood called contextual psychotherapy (CP) to accommodate the IDDM, (b) test and refine the resultant manual with depressed diabetic youth (n=5), conduct a small scale efficacy trial with depressed 8-16 year old diabetic youths (n=40) using a randomized design and "treatment as usual" control group, and (d) arrive at a final psychotherapy protocol suitable for depressed youths with IDDM. Potential subjects will be recruited through the diabetes clinic of the Children's Hospital of Pittsburgh and will be randomized into one of the two treatment cells. CP will include 3 months (16 sessions) of active intervention and a 3 month (3 sessions) "booster" phase. All subjects will receive repeated assessments during the first 6 months of the protocol, and two follow-up evaluations at 9 and 12 months after study entry. A multi perspective assessment battery will be used to quantify psychiatric, functional and familial outcomes. Medical outcomes, determined separately from the treatment study, will be determined as well. Independent clinical evaluation will serve to establish treatment response. Quality care for depression comorbid with IDDM will reduce personal distress, enhance young patients' functioning, may have specific short- and long-term medical benefits, and should result in reduced utilization of health care services.